CHINA GIVES GO-AHEAD FOR NEW DOMESTIC INSURER

China’s insurance regulator CIRC has given permission for 11, mostly state-owned, Shanghai-based companies to set up a specialist agricultural insurer, according to Xinhua news agency. Shanghai Anxin Agricultural Insurance Co will be the first new domestic insurer in seven years. Shanghai Anxin will focus on providing insurance to the agricultural sector around Shanghai. The CIRC has said that more than 60% of its income should be from agricultural cover. CIRC has accepted that the insurer is likely to lose money on these operations and therefore will allow the company to provide other types of insurance on a commercial basis. Shanghai Anxin will also be offered financial support by the Shanghai municipal government, the report said. There is a shortage of capacity in the Chinese agriculture market as a result of most companies pulling out of the sector because of prior losses. Premiums fell by 20% to 480m yuan between 2001 and 2002.